Using Jensen Performance Index
Based on the Jensen performance index, which fund should the investor continue to hold given the following information?
| Fund 1 | Fund 2 | |
| Return on Portfolio | 13% | 17% |
| Beta | .95 | 1.02 |
| Standard Deviation | .18 | .22 |
Risk free rate of return is 7%
Market return is 15%
- Fund 1
- Fund 2
- Both Fund 1 and 2
- Neither Fund 1 nor 2
